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MARKET REPORT: Redrow and Galliford Try to promise to get dividends back

Under-dividend shareholders received good news yesterday after two UK construction firms vowed to repay their payouts next year.

When the pandemic hit its peak and construction companies hammered, Redrow and Galliford Try were among companies that suspended their payouts to save money.

But the pair will resume their division, saying they expected to return to profitability if demand returned. The housing market has picked up since it came out of lockdown hibernation in May, and sales were accelerated by the stamp duty exemption announced in July.

Up: Redrow and Galliford yesterday unveiled plans to resume their division and said they expected to return to profitability as demand returned to the sector

Up: Redrow and Galliford yesterday unveiled plans to resume their division and said they expected to return to profitability as demand returned to the sector

Despite the full year profit at Redrow falling from £ 406m to £ 140m in the year to 28th June, while Galliford revealed an annual loss of £ 35m.

Redrow said it had started the new fiscal year with a strong order book and reservations were up 12 percent in the first 11 weeks compared to 2019.

John Tutte, the company’s boss, said divi payments are expected to return in 2021 “ subject to market conditions. ”

Galliford expects to return to profit after two years of losses in a row, adding that the dividend will recover once it makes a profit. Investors celebrated the results and sent stocks 3.5 percent higher, up 3.06 pence, to 91 pence.

But the promise wasn’t enough to shake up Redrow’s followers, with the FTSE 250-listed group’s share of 1.8 percent, or 8 pence, to 448.2 pence.

Stock Watch – Deck chairs

Café and bar group Loungers was a hit with investors after it reported sales were up 30 percent between July and mid-September compared to last year – boosted by the ‘Eat Out to Help Out’ program.

The AIM-listed group, which operates the Lounge and Cozy Club chains, said the VAT cut on food and non-alcoholic drinks has also helped.

Recliners were up 15 percent, or 24p, to 173p, despite more than doubling losses from Covid costs, the April float and branch openings.

Elsewhere on the FTSE 250, bus and train operator First Group made a profit after it appointed Ant Green, a bus driver and employee trainer for First Bus, to its board.

He becomes group employee director and joins the safety committee. Shares rose 1.7 percent, or 0.72p, to 43p,

But it was Mediterranean oil and gas company Energean that shot to the top of the mid-cap standings – up 20.3 percent, or 106.2p, to 629p – after signing two contracts worth about £ 2 billion to supply gas from a project off the coast of Israel.

The increase was not enough to bring out the wider FTSE 250, which, after a day of treading water, closed 0.11 percent lower, 20.12 points lower, at 17795.26.

The FTSE 100 also finished in the red, dropping 0.44 percent, or 27.06 points, to 6078.48.

Online trading group Plus500 dodged an embarrassing potential investor revolt by delaying a vote on fat cat bonuses.

The company, whose shares fell 1.1 percent, or 16.5 pence, to 1,483 pence, should have voted on a special £ 900,000 payout to Chief Financial Officer Elad Even-Chen, who has been criticized by influential advisers to investors ISS and Glass. Lewis.

But it withdrew the resolution just before the annual meeting began, citing concerns of “ some shareholders. ”

Even-Chen’s bonus, on top of a wage package that could already reach £ 3.7 million this year, had been presented as a reward for his efforts to bring about a tax cut in Israel, where it is based.

However, about 16 percent of investors still opposed the re-election of Plus500 chairman Penelope Judd, after Glass Lewis pushed it to do so.

Chic tonic maker Fever-Tree saw its stock buzz after Berenberg raised the target price on its stock from 2350p to 2500p.

Analysts said there is “excellent” momentum in the US, where lockdown grocery sales will have raised the brand’s profile.

It also has plenty of opportunity to expand into ‘next wave’ European markets, including Germany, Italy, Spain and Switzerland, they said, adding that when the company adds a new product, it quickly proves to be popular.

Fever-Tree closed 9.9 percent higher, up 217p, to 2400p.

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